Electronics Production | September 11, 2008
Farnell post growth of 82% in Eastern Europe in Q2
MDD Europe and Asia Pacific sales growth at 5.5% in the second quarter despite challenging markets. Farnell UK growth continues to outperform the market.
Continued robust performance in MDD North America, with sales growth of 5.5% in the second quarter and 5.8% in the first half as we further embed the strategy and strengthen our EDE and web propositions. Internationalisation plans continue to deliver growth, with second quarter in China up 67% and in Eastern Europe up 82%. Our Indian business grew 50% on its first quarter performance. Second quarter web sales up 42% at Newark and web penetration in China now over 30% as we continue to make progress in all regions. MDD eCommerce sales are now more than 30% of total. Second quarter gross margin at 39.9% (2007/8: 39.6%), representing the eleventh consecutive quarter of gross margin stability. Stable operating margin in the first half, despite continued investment in our strategy. Profit before tax from continuing operations up 11.0% in the second quarter and 24.6% in the first half. Adjusted profit before tax (excluding the gain on the purchase and cancellation of preference shares) up 12.4% and 14.6%, respectively. Commenting on the results, Harriet Green, Chief Executive Officer, said: "We have seen progress in the quarter as the execution of our strategy – focused on the electronic design engineering segment, the web and internationalisation – continues to differentiate us in the industry. Premier Farnell is evolving as all elements of our strategy become more embedded in our businesses. The success we have seen in higher growth markets and in providing customers with the value they demand encourages us to invest further. This, combined with our operational execution leads the Board to anticipate further progress in the second half in line with its expectations."